LifeBrandz to undergo S$100m reverse takeover to go into healthcare

Beleaguered lifestyle group LifeBrandz on Thursday said it has signed a deal with Healthtrends Medical Investments to acquire shares in four target companies in what is essentially a reverse takeover deal.

This is subject to the approval of the Singapore Exchange and its shareholders. The total purchase consideration is S$100 million - to be satisfied by Lifebrandz issuing 10 billion new shares at S$0.01 each.

The valuation of the four target firms was based on a total profit after tax of S$6 million to be delivered by the four firms at a price-to-earnings ratio of 16.6 times.

If they do not deliver S$6 million in net profit after tax, the vendor has the option of acquiring through its own resources a medical business to pick up the slack.

Healthtrends Medical is a Singapore-incorporated investment holding firm in the healthcare and wellness lifestyle domain, with stakes in four separate healthcare companies offering patients medical aesthetics, cosmetic surgery and specialist services through 12 medical clinics in Singapore, Malaysia and Hong Kong and Vietnam.

HealthTrends is owned by mainly local and foreign high-net-worth individual investors, doctors and corporate investors.

Lifebrandz said its directors believe this is an opportunity to acquire a profitable business providing healthcare services which would likely enhance shareholder value and improve the company's prospects.

With this transformation, it will own medical aesthetics and wellness clinics in Singapore, Malaysia, Hong Kong, Vietnam and other Asian markets, with business growth into ownership, development, operations and management of medical centres and hospitals, as well as innovative medical technology businesses.

The vendor has the option to include other assets that it considers relevant to the strategic business plan to transform Lifebrandz into a regional healthcare enterprise. The company may also undergo a restructuring exercise.

If the first phase of completion is not done by January 31, 2016, the company may be transferred to the Catalist board.

Subject to the shareholders' approval, the vendor will also undertake a share consolidation exercise to meet the SGX minimum trading price requirement as soon as possible.